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Local and state cops are only now catching up to the problem of stolen identities. Stephen Stock reports.
This story was published April 3, 2012, at 11:44 p.m. (Published Thursday, Apr 26, 2012)

Updated at 7:02 AM PST on Friday, Apr 27, 2012

It’s the fastest growing property crime in America according to the Federal Trade Commission: We're talking about identity theft.

The Bay Area is at the center of it all, ranking number 72 among metropolitan areas, with 4,521 complaints filed last year.

California ranks third in the nation per capita for the crime, with 38,607 complaints in 2011.

NBC’s Bay Area's Investigative Unit discovered that local and state cops are only now catching up to the size of the problem.

The percentage of stolen identities and fake ID cards has doubled nationally in the last two years.

Every year eight and a quarter million Californians get a new driver's license, but in a flash all that information on that little piece of plastic can be stolen.

"It's very scary," Alex Reyes is a 25-year-old local college student and a victim of identity theft.

"I feel very violated," Reyes tells NBC Bay Area.

In February someone tried to open a new telephone account using Reyes' social security number, name and address.

"I’m afraid to say this, but it’s a little too easy because everyone’s information is out there," Reyes says.

We spoke with Paige Hanson, manager of educational programs for the private identity security company, LifeLock.

"A lot of law enforcement, this is their first time facing identity theft, identity theft cases," Hanson tells NBC Bay Area, "a lot of it has to do with cyber security."

That’s why Hanson was in the Bay Area recently: to lead a closed-door, all-day seminar teaching law enforcement officers as diverse as federal agents to small town cops how to combat fake and stolen IDs.

"It’s really, how do you stop your community members from falling victim to these scams that expose the entire hard drive of their computer or that might accidently leak their bank account information," Hanson explains.

Identity theft can be a threat to national security when stolen information is used to make false documents.

This government report shows how investigators were able to get fake u-s passports by using stolen identities of children as young as 5 years old and dead people.

We spoke with Immigrations and Customs Enforcement Special Agent Anthony Ho last month.

"People can use these high quality IDs for things for like, everything from getting into a bar to potentially getting into areas that are secure," Agent Ho tells NBC Bay Area

And there are local companies in the business of finding a solution.

"It is very serious," Greg Miller, Vice President of JDSU, a Silicon Valley tech company tells us.

JDSU's mission is to pioneer technology that makes documents and IDs harder to fake and easier to authenticate.

"We have very unique optical effects that can be put onto the document," Miller tells NBC Bay Area, "we also put in things that you cannot see that can only be detected with an instrument or seen through a microscope."

JDSU isn't the only one looking for an answer.

Professor Patrick Kelly teaches Computer Security at the University of San Francisco.

He’d like to see the identification system go in a different direction. Instead of passports and drivers’ licenses, Kelly thinks the solution is to make a digital ID bank with layers of encryption and control.

"We want to create a facility so that you can go ahead and create and control your own identity information," Dr. Kelly says, "we want a driver's license to simply be a token, a token that can be authenticated."

However, until stronger systems are created there will continue to be victims who have their information compromised online, like USF student, Elizabeth Farmer.

"It’s a very unsettling feeling to have something like this happen to you," Farmer tells NBC Bay Area, "I was floored."